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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 14D1/A
TENDER OFFER STATEMENT PURSUANT TO SECTION
14(d)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 1)
WNC California Housing Tax Credits, L.P.
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(Name of Subject Company [Issuer])
Everest Tax Credit Investors, LLC
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(Bidder)
Units of Limited Partnership Interests
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(Title of Class of Securities)
None
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(CUSIP Number of Class of Securities)
Christopher K. Davis
Everest Properties II, LLC
199 S. Los Robles Ave., Suite 440
Pasadena, CA 91101
Telephone (800) 611-4613
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications on Behalf of Bidder)
CALCULATION OF FILING FEE
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Transaction Valuation: $74,500(1) Amount of Filing Fee: $14.90
(1) Calculated as the product of the number of Units on which the Offer is
made and the gross cash price per Unit.
[X] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the form or
schedule and the date of its filing.
Amount previously paid: $14.90 Filing party: Everest Tax Credit Investors, LLC
Form or registration no.: SC14D-1 Date filed: May 12, 1998
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Schedule 14D-1
CUSIP No : None
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Everest Tax Credit Investors, LLC
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2. CHECK THE APPROPRIATE BOX IF A MEMBER (a) [ ]
OF A GROUP* (b) [ ]
Not Applicable
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3. SEC USE ONLY
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4. SOURCE OF FUNDS*
AF
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM
2(e) OR 2(f) [ ]
Not Applicable
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
California
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
None
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES [ ]
CERTAIN SHARES
Not Applicable
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
Not Applicable
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10. TYPE OF REPORTING PERSON*
OO
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AMENDMENT NO. 1 TO SCHEDULE 14D-1
This Amendment No. 1 amends the Tender Offer Statement on Schedule
14D-1 filed by Everest Tax Credit Investors, LLC, a California limited liability
company (the "Purchaser") with the Securities and Exchange Commission on May 12,
1998, relating to the Purchaser's offer to purchase up to 745 units of limited
partnership interests ("Units") in WNC California Housing Tax Credits, L.P. (the
"Partnership") upon the terms and subject to the conditions set forth in the
Offer to Purchase, dated May 12, 1998, and the related Agreement of Transfer and
Letter of Transmittal. Capitalized terms used but not defined herein have the
meaning ascribed to them in the Offer to Purchase. The Offer is hereby amended
to include the information below.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(b) On or about May 27, 1998, the Purchaser contacted representatives of
the Partnership to ask for information supporting the Partnership's
statements in its Schedule 14D-9 dated May 27, 1998, regarding the
most recent sale of Units on the secondary market, in particular, the
date of the transaction described. The Purchaser was advised that the
General Partner would not disclose further details regarding the
transaction. Also, in response to the Partnership's statements in its
Schedule 14D-9 dated May 27, 1998, the Purchaser has advised
representatives of the Partnership that the Purchaser's tax counsel, a
nationally recognized law firm, will provide the Partnership with a
legal opinion that Everest believes is adequate such that the
Partnership will have no legal reason to limit the number of Units
that the Purchaser may purchase in the Offer.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) Effective May 27, 1998, the Option Agreement was terminated in its
entirety by mutual agreement of the parties.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES.
Effective May 27, 1998, the Option Agreement was terminated in its
entirety by mutual agreement of the parties.
ITEM 10. ADDITIONAL INFORMATION.
(f) Reference is hereby made to the information set forth in the Letter to
the Holders of Units, dated June 4, 1998 , a copy of which is filed as
Exhibit 11(a)(4), which is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
11(a)(4) Letter to the Holders of Units, dated June 4, 1998.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: June 3, 1998
EVEREST TAX CREDIT INVESTORS, LLC
By: EVEREST PROPERTIES II, LLC,
Manager
By: /s/ David I. Lesser
David I. Lesser
Executive Vice President
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EXHIBIT INDEX
Exhibit No. Description
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11(a)(4) Letter to the Holders of Units, dated June 4, 1998.
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[EVEREST TAX CREDIT INVESTORS, LLC Letterhead]
June 4, 1998
To the Holders of Units in
WNC California Housing Tax Credits, L.P.
RE: Offer to Purchase up to 745 Units
We are offering you an opportunity to sell your limited partnership
interest ("Units") in WNC California Housing Tax Credits, L.P. (the
"Partnership") for cash in the amount of $100 per Unit, and insure a 1998 tax
deduction and liquidation of your investment.
What benefits does a seller receive? Most individual sellers will
receive the following:
a. $698.50 per Unit tax deduction in 1998 against ordinary income.*
b. $201.50 per Unit long term capital loss.*
c. $100 per Unit in cash now.
What tax credits remain? Assuming there are no property fore-
closures, the Partnership has indicated that there are approximately $224 of
credits remaining through December, 2001 (which we believe to be the end of the
credit period). We are offering a guaranteed $100 cash now, plus a potential tax
benefit for 1998 worth $291.76*, compared to projected but uncertain tax credits
which have a benefit over the next 2 1/2 years. The cash purchase price plus the
value of the current year tax loss (a total of $391.76*) exceeds the amount of
your remaining credits ($224).
Why does our company want to purchase these Units? Tax credit and losses
generated by the Partnership are more valuable to us, as a corporation, than to
an individual investor. We can use all of the tax credits and take a current
deduction for all of the passive losses. Current tax laws restrict individual
use of both tax credits and passive losses.
Consider the following analysis for each $1,000 Unit originally purchased:
Seller's Tax Credits
Earned through 6/30/98* $ 1,517.50
Cash From Sale $ 100.00
Current Year Tax Benefit $ 291.76
From Sale* -----------
Total Benefits* $1,909.26
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*Assumes a sale date of 6/30/98; the Units were held by individuals from
inception; prior passive activity losses have not been utilized; ordinary income
and capital gain federal tax rates of 36% and 20%, respectively; the sellers
sell all of their interest in the Partnership; and none of the gain from the
sale of the Units is attributable to depreciation recapture.
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The general partner claims that the most recent sale price for the Units
was $237, but does not disclose to you when that transaction occurred. The
general partner admits that "the current value of a Unit may have been reduced
from the last selling date because there are fewer Tax Credits due to passage of
time." The general partner refused to provide us with the date of the
transaction they used as a comparison. For example, if that transaction took
place two years ago, then the tax credits received since then plus the $100 cash
offered by Everest exceeds by about $80 the most recent sale price described by
the general partner, after deducting customary sales commissions (assumed at
8%). Unit holders that sell to Everest will not pay commissions.
In any event, the general partner's statements indicate that no transfer of
Units has occurred this year. Therefore, this may be your only chance to sell
your Units for some time.
Investors in tax credit partnerships should also consider the following
facts:
Sellers will avoid all recapture tax liability from any foreclosed
properties after 1998.
The Partnership's properties are subject to rent restrictions for 30
years.
Sale of your Units will NOT result in the recapture of tax credits
previously taken.
Sale of your Units will eliminate troublesome K-1's after 1998.
You should review carefully our Offer to Purchase dated May 12, 1998, which
we previously sent, before deciding whether or not to sell your Units. We urge
you to contact your tax advisor regarding your ability to use future credits and
tax losses from a sale.
An additional Agreement of Transfer is enclosed, which can be used to
accept our offer. Please execute this document and return it in the enclosed
envelope. The purchase price will be reduced by any cash distributions made to
you by the Partnership after April 14, 1998 (although we are not aware of any),
all tax credits allocated to you after June 30, 1998, and any transfer fees
charged by the Partnership.
The general partner states that Everest may be limited in the number of
Units it could purchase unless the Partnership receives persuasive authority
that such limitation is unnecessary. Everest has advised the Partnership that
its tax counsel, a nationally recognized law firm, will provide the partnership
with a legal opinion that Everest believes is adequate under the requirements of
the Partnership Agreement, and therefore the Partnership will have no legal
reason to limit the number of Units that Everest could purchase in its offer.
As a reminder, our offer expires on June 15, 1998, at midnight.
Please call us at (800) 611-4613 if you have any questions.
Everest Tax Credit Investors, LLC
